Slightly Lower Trade as USDA Report Approaches
Sep 27, 2012
Good Morning! Steve Georgy with early morning comments for September 27, 2012 at 5:10 am. Grain futures are pushing lower this morning after taking out support levels yesterday. This morning USDA will release export numbers at 7:30 central time. This will be watched closely as traders still wait to see if demand is picking up. Corn estimates are between 125,000 and 300,000 tonnes, beans have a range of 600,000 – 800,000 tonnes, and wheat is expected between 300,000 – 600,000 metric tonnes. Beans and wheat have been within the trade range over the last several weeks but corn has struggled. We are watching a story closely that was released late yesterday that a group of three companies out of North Carolina have signed a deal to bring in 750,000 metric tonnes of corn from Brazil. Hog producer Prestage Farms and 2 other livestock companies made this deal due to "sky high" prices in the US. This is the largest import of corn on record and it comes after the biggest drought we have seen in half a century. The USDA is projecting corn imports at 1.9 million metric tonnes for the marketing year ending August 31st, 2013. Tomorrow is also the last day of the month and last day of the quarter. This may cause more liquidation from the funds as they continue to lighten up on positions. USDA will also release the quarterly stock number tomorrow at 7:30. The trade is expecting more bearish numbers for both corn and beans. This could lead to more pressure in the short term. The charts are negative mixed with bearish fundamentals right now. Cattle are once again trading lower and have been mostly pressured from weaker cash trade. We were hearing rumors of cash cattle trade $122 in Texas on Tuesday but there were some $123 purchased yesterday out of Kansas. The trade was expecting steady to $1 lower this week and we are seeing $3-$4 lower. Box beef finished lower yesterday with choice down .23 cents at 192.45 and select down .05 at 181.51.
Markets as of 5:10 AM
Dec Corn -2 3/4
Nov Beans UNCH
Dec Wheat -1 1/2
Oct Cattle -.27
Oct Hogs -.15
Dec Dlr -.06
Sep S+P +6.50
Oct Crude +.30
Dec Gold +5.20
Allendale Advanced Charts
Dec Wheat has continued its aimless sideways trading range over the last 3mos. With this market not showing much in terms of direction, we must wait for a breakout for the wheat market to show its directional hand…Frank La Placa
Get technical analysis for corn, beans, wheat, cattle, hogs, crude and dollar markets.
Nelson Notes from the desk of Rich Nelson
Allendale’s monthly webinar series continues to be a success. Tuesday night we interviewed USDA’s South American meteorologist. Great insight into his thoughts on El Nino, and what it could do for yields in Argentina and Brazil, were heard. In addition, Allendale discussed cash grain marketing factors to consider such as futures, basis, and storage costs.
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